Donations treatment in balance sheet

You need not to pass any entry for donation disallowed in income tax and it is not required to increase the profit in books. Please note that it is not necessary to match the profit of books with the profit of income tax.

It is wrong to say that profit will increase. The profit of the assessee will remain same. The taxable income is different from the profit shown by the assessee. Therefore, disallowance of donation will have impact on the tax liability but books of account will remain same.